Berlusconi Coalition Defeated in Milan, Naples Mayoral Races

May 30 (Bloomberg) -- Italian Prime Minister Silvio
Berlusconi’s bloc lost mayoral races in his hometown of Milan
and Naples, a blow to his coalition that may raise the chance of
early national elections.

Milan Mayor Letizia Moratti, Berlusconi’s candidate, was
defeated in the premier’s hometown to Giuliano Pisapia by 44.9
percent to 55.1 percent, according to the Interior Ministry’s
website, with 95 percent of votes counted in the runoff
election. Moratti conceded defeat, Pisapia said at a press
conference.

The center-left opposition’s Luigi De Magistris beat
Berlusconi-backed Gianni Lettieri in the Naples election by 65.3
percent to 34.7 percent, and its candidates also triumphed in
the northern cities of Mantova and Trieste, as well as Cagliari,
the capital of Sardinia.

“A victory by Pisapia in Milan will have a direct effect,
making Berlusconi’s grip on the government much weaker,” said
Giuseppe Ragusa, an economics professor at Rome’s LUISS
University. “Many observers are already discounting the
possibility that this majority is not going to be able to
implement the economic reforms this country really needs.”

As Berlusconi grapples with the fallout from corruption
charges and allegations he paid for sex with a minor, the
outcome is viewed as an indication of his support nationally at
a time when Italy’s economic recovery is trailing the rest of
the euro region. The premier had staked his personal reputation
on the Milan race, putting himself at the head of his party’s
ticket in the first round to bolster support for Moratti.

Northern League

The voting, which began yesterday and ended at 3 p.m.
today, came after Berlusconi suffered a setback in local polls
on May 15-16, when the opposition triumphed in the first round
in Turin and Bologna amid lackluster results by the anti-immigrant Northern League, a key part of the ruling coalition.
League leader Umberto Bossi told supporters afterwards that
Berlusconi is costing the governing coalition votes.

Today’s defeat for the ruling coalition, whose mandate ends
in 2013, “was a vote against Berlusconi” Matteo Salvini, a
League lawmaker, was quoted as saying by Ansa newswire. While
the League “did all it could to talk about concrete problems,
the voters are sovereign and we take note,” he said.

Berlusconi had stepped up his campaign efforts over the
last two weeks, saying that Milan would become a “Zingaropoli”
-- or Gypsy town -- if Pisapia wins. Moratti’s rival would allow
the construction of a huge mosque to accommodate Muslim
immigrants while turning Milan into a “Stalingrad” hotbed for
communists, the premier also said.

‘Racist’ Remarks

Some of Berlusconi’s comments have been “racist and will
haunt Italian politics for years to come as the country tries to
deal with the real pressures which mass immigration engenders,”
James Walston, who teaches politics at the American University
of Rome, wrote in his blog on May 28.

Berlusconi’s popularity has been hurt by allegations that
he paid an underage nightclub dancer for sex. He also faces
bribery, fraud and tax-evasion charges in three other trials
related to his management of broadcaster Mediaset SpA before he
entered politics. The sluggish economy may also be costing him
votes, as it expanded only 0.1 percent in the first quarter
compared with 0.8 percent in the euro region.

Italy “has just experienced its own lost decade” with
weak competitiveness and lack of growth, Emma Marcegaglia, the
head of the country’s main employer’s lobby, said on May 26. A
Milan vote defeat should spur the government to “focus on a
sole priority: growth” and “cutting red tape, liberalizing,
infrastructure, and tax reform,” she said.